Beneflex General News

The Patient Protection and Affordable Care Act (PPACA) uses terms that sound alike for three very different things.  Here's a closer look at these terms, and when they're used.

Essential Health Benefits
Significantly affects individuals and small employers with a fully insured plan.  Has a limited impact on self-funded and large insured plans.

Beginning in 2014, policies in the individual and small group markets* will be required to provide coverage for each of the 10 "essential health benefits" regardless whether the policy is purchased through or outside the exchange.  Self-funded plans (regardless of size), large group plans, and grandfathered plans (regardless of size) do not have to cover all 10 essential health benefits, but they will not be allowed to put lifetime or annual dollar limits on an essential health benefit.

Each state will have its own "benchmark" essential health benefits package. The essential health benefit categories are ambulatory/outpatient, emergency, hospitalization, maternity and newborn care, mental health and substance use, prescription drugs, rehabilitative and habilitative services and devices (for example, speech, physical and occupational therapy), laboratory services, preventive and wellness services and chronic disease management, and pediatric services, including pediatric dental and vision care. 

Minimum Essential Coverage
Affects most individuals and all employers with 50 or more employees (regardless whether its plan is self-funded or fully insured).

Beginning in 2014, most Americans will be required to have "minimum essential coverage" or pay a penalty with their tax return. (In 2014, the penalty will be the greater of 1 percent of income or $95.

REINSURANCE FEE
The Department of Health and Human Services (HHS) has released final rules on the Transitional Reinsurance Program fee under the Patient Protection and Affordable Care Act. In the final regulations, HHS estimates that a fee of $63 per plan participant will be needed to pay for the first year of the program, which is designed to reimburse insurance carriers for issuing policies for individuals with high health costs, starting in 2014. Employers with fully insured plans likely will see the fee passed down through their health plan carrier, while self-funded employers will be responsible for covering the fee directly.

NEW FMLA FORMS
In February, the Department of Labor (DOL) issued final regulations with amendments to military family leave, flight crew eligibility and other issues under the Family and Medical Leave Act (FMLA). With those changes, the DOL is requiring covered employers to update their FMLA posters and forms by March 8. You can find more information about the changes on the DOL website: http://www.dol.gov/whd/fmla/

WELLNESS SPENDING
Employers look to spend an average of $521 per employee in wellness-based incentives this year, a 13 percent increase from $460 in 2011, according to the National Business Group on Health (NBGH). The organization estimates spending on corporate wellness-based incentives has doubled since 2009.  NBGH also reports that 77 percent of polled midmarket employers plan to offer wellness-based incentives in 2013 -- more than double the number in 2010.

HOT HIRING
Four in 10 employers in the manufacturing and service industries expect to add jobs in March, according to the latest LINE survey by the Society of Human Resource Management.

By Mary F. Drueke, FSA
Vice President of Employee Benefits
Swartzbaugh-Farber & Associates, Inc., a UBA Partner Firm

The employee benefits world will continue to get more complicated and more personal over the next year. Employers will be faced with many tough decisions as they prepare to "play or pay" in 2014, and most of 2013 will be spent modeling the financial impact of health care reform and ensuring that employers are ready for implementation of the law. While employers need to make sure they are offering affordable benefits that provide minimum value, as a result of the new exchanges coming online and less of their own budget going toward major medical coverage, they will have a new opportunity to offer increased value through ancillary benefits -- an area expected to grow substantially in the coming years.

One of the few things we do not expect to change is that employers will continue to need to attract and retain the best employees. How they differentiate themselves, however, will vary based on their size, industry and region. Ancillary (which often are voluntary) benefits such as dental, life, vision, long-term disability, critical illness and paid-time off, are going to become more important as employers use these types of benefits to attract key employees, especially at the executive level.

Employers can still offer employees the ability to choose from a menu of benefits that meet their employee's needs, even if the employees pay the full cost of those benefits.

Wednesday, April 3 - 2 p.m. ET / 11 a.m. PT

Controlling costs is the top priority for public sector benefits programs, but how can employers know what works and what doesn't -- and how much money can you really save? This webinar will look at best practices researched by Colonial Life and the Government Finance Officers Association -- an organization of over 17,000 financial administrators across the country - to help you understand:

• Which benefits cost management strategies are most widely used in public sector
• Which strategies are the most highly recommended
• Which strategies are being underutilized and why
• The amount of savings possible by implementing some of these strategies
• Case examples

This session will help both public and private employers benchmark the strategies they are currently using to manage employee benefits cost and validate their direction, as well as give new ideas on practices and techniques they could be implementing to help manage control the ever-increasing costs of employee benefits

To register or to learn more, please contact us.

NEW PPACA DETAILS

Eligibility Waiting Periods  l  Employee Notices  l 
Claims Appeals    

The Department of Health and Human Services (HHS), the Department of Labor (DOL) and the Internal Revenue Service (IRS) continue to issue details on the Patient Protection and Affordable Care Act (PPACA).  The past 10 days has brought several changes of interest to employers:

Eligibility Waiting Periods
Affects all plans, whether fully insured, self-funded or grandfathered.  Applies to all sizes of employers, as of the start of the 2014 plan year

The agencies have issued proposed regulations that state that an eligibility waiting period cannot be more than 90 days.  This literally is 90 calendar days -- a plan that begins coverage as of the first of the month after 90 days of employment, or after three months of employment, will be out of compliance.  If the 91st day falls on a weekend or holiday, the plan may not wait to begin coverage until the following work day -- in that situation, the plan will need to begin coverage as of the Friday before the end of the allowed waiting period.

Example: Sam starts work on July 14, 2014.  His coverage must begin on or before Oct. 13, 2014. If Sam's employer is closed that day for Columbus Day and it cannot begin coverage because of the closure, his coverage must begin Friday Oct. 10.

The waiting period may be delayed until the employee meets the plan's eligibility requirements -- for example, if the plan does not cover employees who work fewer than 30 hours per week or employees in certain job categories, and an employee moves from ineligible to eligible status, the waiting period may begin as of the date the employee first moves into the eligible class.

Tuesday, April 9 - 2 p.m. ET / 11 a.m. PT

The federal government handed down final HIPAA Privacy and Security rules in January, and now health plan sponsors and their business associates must ensure they're up to speed and compliant with the new requirements by Sept. 23, 2013. These new rules will, among other things, affect business associate agreements, privacy notices and breach notifications -- and will carry stiff penalties for those who don't follow them.
 
Join us for this 90-minute, intermediate-level webinar in which we will provide a brief recap on the HIPAA requirements for group health plans and highlight what's new and what actions employers need to take to make sure they don't run afoul with the law.
 
The presentation slides will be posted the day before the webinar. For more information or to register, please contact us.

Higher deductibles and increased cost sharing are starting to push more employees to check the price tag before they schedule physician visits or buy medicines. Without help and resources from employers, though, this consumerism movement might end up in the clearance bin of health insurance fads, experts warn.

"We'd like to see a stronger presence from employers on price transparency," Anne Weiss, team director at the Robert Wood Johnson Foundation, told Human Resource Executive Online. "They're spending a lot of money on health care and, frankly, not getting much for it."

The foundation estimates that poor quality care costs an average employer between $1,900 and $2,250 per worker per year. Companies must demand price transparency and more information from insurers and medical providers if they want to see real results from health consumerism, Weiss said.

"Employees need to see the full picture of what they're paying for," Weiss said. "Employees may want to know the total cost, but they especially want to know what it's going to cost them out of pocket, and that takes more intensive interaction between plan and provider."

Some companies are taking an aggressive stand against rising prices and poor care by encouraging employees to get second opinions, according to a MarketWatch report. Employers are turning to "second-opinion companies" that analyze costs and recommend alternative treatments. While the alternatives are not necessarily cheaper, they typically steer patients away from "big-ticket" procedures such as surgery.

More information and choices are only the first step. Employees need to know how to act on what they learn, and employers have an obligation to step up and deliver that direction, David Marini of ADP told HREO.

"There have to be major communication campaigns -- just putting these tools in place will not get organizations to where they need to be," Marini said. "Someone has to take the responsibility for education, and that responsibility falls on the employer."

As rising health care costs take their toll on traditional benefits offerings, voluntary options are emerging as a "win-win" situation for employers and employees alike.

While voluntary benefits, in which employers pay little or nothing toward the cost of coverage, may seem like a downgrade compared with traditional employer-paid benefits, experts say many employees prefer having more choices through voluntary options and appreciate employers' help in securing the best choices.

"Employers and employees agree on the value of voluntary benefits," Bob Patience, a vice president with Prudential, said in a recent press release. "Employers see an increase in employees' satisfaction with their benefits program, while employees appreciate their employers' endorsement of the products offered, and believe they get good value because of their employers' involvement and diligence."

A recent poll by Prudential found that among workers whose employer offered at least one voluntary benefit, 63 percent said the voluntary option increased the value of the overall benefits package. The number of employees who said they would like to see more voluntary choices was 34 percent -- a 10 percent jump from last year.

Of all voluntary benefits, Prudential's research predicts that critical illness has the most growth potential, according to its survey results.

Critical illness coverage is especially attractive for employees in high-deductible health plans because it can ease the massive out-of-pocket costs that can be incurred under such plans if a participant becomes seriously ill, experts say.

"A lot of folks market critical illness as a health care complement -- and it is -- but it also needs to be marketed as a financial protection benefit, as well," said Rob Shestack, senior vice president with AmWINS Group Benefits, told Employee Benefit News.

Voluntary benefits, though, aren't limited to health care-related coverage. The Prudential survey notes that accident, disability, dental and life insurance likely will become more popular in the future, as well.

Legal assistance programs also are seeing a bump in popularity, according to a separate survey by MetLife. Two-thirds of employers without such a benefit said they'd consider adding legal assistance if they knew more about the product.

"The interest in legal plans by both employers and employees has been steadily building," Bill Brooks, CEO of Hyatt Legal Plans, told EBN. "This is a benefit that spans the generations and suits a diverse workforce because there is a broad range of situations where an attorney can help."

Whatever the choices, employers are beginning to view voluntary benefits as a key component to their efforts to build a happier and more loyal workforce. The MetLife survey found that 69 percent of companies that offer voluntary benefits do so to boost employee satisfaction, while 44 percent said they rely on voluntary offerings to boost their retention rates.